Indian integrated steel mills have largely kept their billet export allocation limited and focused on their local market. Stray deals have been concluded at higher levels, beyond the expectations of sellers, traders and company officials have told SteelOrbis.
The reference price for Indian billet was settled by SteelOrbis at $428-430/mt FOB, marginally up from $425-430/mt FOB last week. However, sources said that overall trading activity is low considering that key buyers in China are largely absent from concluding transactions and even trades concluded during the past week were generally not acceptable to a larger number of buyers.
An eastern India-based steel mill has submitted offers ranging at around $435-440/mt FOB to a trading firm, higher as in earlier weeks. A small tonnage contract for November delivery was concluded by the producer at a lower price of $428-430/mt FOB, according to sources, which was still higher than the lower valuations being sought by general Chinese buyers.
The state-run Rashtriya Ispat Nigam Limited (RINL) has concluded an export tender for 30,000 mt of 150 mm billet at the highest bid of $430/mt FOB, which was $5/mt above the previous tender of the mill, as SteelOrbis reported yesterday, September 15.
Also, a tender for a smaller volume of 125 mm billet by SAIL was widely discussed in the market. Most sources said that it has not been finalized yet as the producer may decide to “keep the cargo” for its own needs, sources said.
An Odisha-based steel mill reported a deal for 12,000 mt with an Asian buyer for November deliveries at around $425-428/mt FOB last week.
“While buyers are willing to contract only if low valuations are on offer, local exporters are unwilling to be aggressive in committing outward shipments as export realizations are still marginally lower than realizations from local sales and there is a lower exportable surplus after captive value-added conversion at their own rolling mills,” an official at Jindal Steel and Power Limited (JSPL) said.
However, in the local market with secondary rebar producers’ rising inventory triggering lower demand for merchant purchases of billets from integrated steel mills, there is a slight softening of billet prices in India. Local billet prices have edged down INR 400/mt ($5/mt) to INR 31,500-31,800/mt ($427-431/mt) ex-works.
$1 = INR 72.70